On Jan. 27, the White House budget office ordered a pause on all federal grants and loans — an order that will likely impact numerous public programs that many Americans rely on. The announcement caused a full day’s panic for students and parents for those worried this action would put their federal financial aid at risk. However, on Jan. 28, it was revealed that the pause will not affect federal funding toward educational grants or loans, which should come as a relief to many — if only a temporary relief.
ICYMI, here’s what went down: A two-page memo from Matthew J. Vaeth, who is the Acting Director of the Office of Management and Budget, directed federal agencies to “temporarily pause all activities related to obligation or disbursement of all federal financial assistance,” and any other programs that included “D.E.I., woke gender ideology and the Green New Deal.” The deadline when certain funds will be frozen was set for 5 p.m. on Jan. 28.
While the memo specified that the pause will not affect Social Security or Medicare benefits, it did not specify whether or not educational grants and loans would be affected, leaving many students and parents fearful of how they’d be able to finance their education. But on Jan. 28, the U.S. Department of Education clarified that the pause on federal spending did not apply to federal student loans or Pell Grants, which help low-income students pay for college.
“The temporary pause does not impact assistance received directly by individuals,” Madison Biedermann, the current spokesperson for the department, told USA Today. Also safe from the pause is funding toward the federal work-study program, which provides many college students campus jobs.
However, while educational grants and loans will remain intact during the federal funding pause, they will still be under review by the Trump administration to ensure they comply with his slew of executive orders. Federal agency officials will be given until Feb. 10 to answer a list of questions that examine whether or not their programs support “illegal aliens,” promote “gender ideology,” or provide funding to “illegal DEI.”
So, while student financial aid is not immediately affected, it is still at risk, and many officials are concerned and intent on keeping close watch for any further developments. “This is unprecedented. It is harmful,” Jon Fansmith, the assistant vice president of government relations at the American Council on Education, told USA Today about Trump’s federal funding contingencies. “We are still figuring out just how bad it will be.”